Investor Presentation

Transcription

1 Investor Presentation January 2018

2 Contents 2 About Ford Otosan 3 Plants and Facilities 11 Products 18 Investment Case 25 Operating and Financial Performance 45 Guidance 65 Contacts 66

3 3 About Ford Otosan

4 Company Profile 4 Key Indicators, 2016 Revenues Export Revenues EBITDA Profit Before Tax Net Profit $6.1 billion $3.8 billion $519 million $321 million $317 million Ford Motor Co. Ford Otosan 41% 41% Koç Group ROE 30.2% EBITDA margin 8.6% Annual Production Capacity 415,000 Free Float 18% Gölcük (Transit & Custom) 290,000 Yeniköy (Courier) 110,000 İnönü (Cargo) 15,000 Total Employees 10,261 Blue Collar 7,561 White Collar 2,700 Paid-in Capital: TL 350,910,000 Traded on Borsa Istanbul since 13 January 1986 Ticker: FROTO.IS

5 Ford Otosan at a Glance 5 Pioneer of Turkish automotive First Turkish passenger car Anadol (1966) Turkey s first domestic diesel engine Erk (1986) Turkey s first private R&D center in automotive (1961) First export of Turkish automotive to the US (2009) Strong value contribution Turkey s export champion Turkey s 2 nd largest industrial enterprise Highest employment in Turkish automotive Leadership and scale Europe s largest commercial vehicle manufacturer Widest product range in Turkish automotive Turkey s patent champion in automotive

6 Leading the Turkish Automotive Industry 6 21% of Turkey s Total automotive production 30% of Turkey s Commercial vehicle sales 68% of Turkey s Commercial vehicle production 72% of Turkey s Commercial vehicle exports

7 Key Player in Ford Motor Company Universe 7 Robust sales performance Highest commercial vehicle market share of Ford in Europe Among Ford s top 2 markets in Europe (Britain, Turkey, Hungary, Ireland, Romania) Europe s largest CV manufacturer Lead manufacturing plant of Ford Transit globally Single source of Ford Custom & Tourneo Custom Single source of Ford Courier & Tourneo Courier One of the two production centers globally for Ford Cargo heavy trucks Engineering and R&D power Global hub for Cargo heavy trucks and related powertrains Global support for Light Commercial Vehicle Development Global support for Diesel Powertrain Engineering

8 Ford Otosan at a Glance 8 Production Capacity 1997* 2016 (Units) 47,000 9 times 415,000 Production (Units) Export 43,102 8 times 333,749 (Units) times 257,246 Export (USD) 16 million 250 times 3.8 billion Revenue (USD) 660 million 9 times 6.1 billion Headcount 3,406 3 times 10,261 Market Cap (USD) 1.1 billion 3 times 3.1 billion

9 Vision, Mission And Strategy 9 Vision Being Turkey s most valuable and most preferred industrial company. Mission Providing innovative automotive products and services beneficial to the community. Strategy Growth: Organic and inorganic growth in new markets and existing business areas by developing new products. Innovation: Providing innovative products and services in all business processes by keeping creativity at the top. Brand: Being the most preferred brand in all segments by meeting customer needs and expectations. Employees: Being the most preferred workplace by aiming excellence in human resources processes and increasing benefits provided for employees. Customers: Being the leader automotive brand with regards to customer satisfaction in sales and after sales products and services.

10 Brief History 10 First automotive production starts in Turkey under license agreements in a heavily protected domestic economy. Turkey takes first steps to liberalize its economy and integrate with the rest of the world. Customs Union is signed with the EU in Exports start to increase. Incentives are introduced for production in Turkey. Turkey becomes a major hub in automotive production and moves up the value chain, from an assembly center to full product development and manufacturing with focus on R&D. Turkey is the 14 th largest auto manufacturing hub in the world and 5 th largest among European countries. First Years 1980s 1990s Vehbi Koç is assigned as Ankara Ford dealer 1959 Otosan is founded as Ford assembler in Turkey 1960 Otosan s first production: Ford Consul 1966 Otosan produces the first Turkish car Anadol 1967 Otosan produces its first Transit 1982 İnönü Plant opens 1983 Cargo production starts Ford Motor Co. increases its share in Otosan to 30% 1985 Production of Ford Taunus 1986 Otosan produces Turkey s first diesel engine ERK 1992 Production of the new generation Transit Production of Ford Escort 1997 Ford assumes 41% equity in Ford Otosan 1998 Ford Otosan spare parts distribution center opens 2001 Gölcük Plant opens 2002 Transit Connect launches 2003 New Cargo launches 2003 Transit Connect International Van of the Year 2007 Gebze Engineering Center opens 2007 Transit International Van of the Year 2009 First vehicle export to North America 2010 Ford Otosan s 50 th Anniversary 2010 Transit Connect N.A. Truck of the Year 2011 Transit Connect NYC Taxi launches Launch of Ford Custom 2013 Ford Otosan s 12 th year of market leadership 2013/2014- JMC engine & truck technology licensing agreements 2014 Yeniköy Plant opens 2014 Launch of new Ford Transit and Ford Courier 2015 Sancaktepe Engineering Center opens 2016 Ecotorq engine production starts

11 11 Plants and Facilities

12 Locations 12 Sancaktepe Parts Distribution Center (1998) Sancaktepe Engineering Center (2015) İnönü Plant (1982) Kocaeli Plants: Gölcük Plant: Transit (2001), Custom (2012) Yeniköy Plant: Courier (2014)

13 Gölcük Plant Lead Manufacturing Plant of Ford Transit 13 Port Yeniköy Plant Assembly Shop Paint Shop Body Shop Tool & Die Press Shop Transit 160k Custom 170k 315,000 units manufacturing capacity Investment currently under way to increase capacity to 330,000 units by September Further details available on page 36. 1,600,000 m 2 total area; 340,000 m 2 covered area Opened in 2001

14 Yeniköy Plant The Single Production Center of Ford Courier in the World 14 New production facility at Gölcük plant site opened on 22 May ,000 m 2 covered area Environment and disabled-friendly plant Courier 110k

15 İnönü Plant Center of Excellence for Ford Trucks 15 Opened in 1982 Cargo 15k 88,000 m 2 covered area 80k units engine, 140k units powertrain production capacity L / 9.0L E6 Diesel engines for Cargo heavy truck - 2.2L 4-cyl. Duratorq TDCI engines for Transit

16 Sancaktepe Parts Distribution Center 96% Fill Rate 16 Opened in ,000 m 2 warehouse: Largest of its kind in Turkey 4 th largest warehouse capacity among Ford s parts distribution centers in Europe

17 Sancaktepe Engineering Center Turkey s largest R&D Center 17 Center of Excellence for heavy trucks and heavy duty diesel powertrain for large trucks Global engineering lead for Ford Cargo heavy trucks and related powertrains Global support for diesel powertrain engineering Global support for light commercial vehicle development (B- & C-car derived Integrated Style Vans)

18 18 Products

19 Ford Transit, Best-Selling Van in the World 19 Longest-running model in Ford of Europe s product range ~ 9 million units produced globally since its launch in 1965 Manufactured by Ford Otosan since 1967 Ford Otosan is the lead manufacturing plant of Transit globally All-New Transit launched from March 2014 to October 2014 in 3 phases Chassis Cab Van Minibus Loading Capacity: 3.3 tons 4.7 tons Loading Capacity: Seating Capacity: 9.5m m / 17+1 Market share details available on page 48.

20 Ford Custom 20 Ford Otosan is the single global source of Ford Custom Launched in October 2012 First vehicle in its segment to achieve a maximum five-star Euro NCAP rating Tourneo Custom (People Mover) Long and Short Chassis 8+1 Seating Capacity 4.97m 5.34 m Transit Custom (Commercial) Loading Capacity: 5.9 m m 3 Loading Capacity: 6.8 m m 3 Market share details available on page 48.

21 Ford Courier 21 The smallest member of the Ford commercial vehicle family Ford Otosan is the single global source of Ford Courier Launched in May 2014 Tourneo Courier (People mover) Transit Courier Combi Van (Commercial) Transit Courier Van (Commercial) Market share details available on page 48.

22 Ford Trucks 22 Manufactured at Ford Otosan s İnönü Plant since 1983 Road truck, construction and tractor series available Cargo 1846T 2013 International Truck of the Year 3 rd place TRACTOR ROAD TRUCK CONSTRUCTION 4x2 Tractor and 6x2 Full Trailer are the main applications. Available in E3&E5 and E6 emission levels with 13L Ecotorq engine generating power 420 and 480 PS Long Haulage Mainly used for local distribution and municipality (special purpose vehicles) 4x2, 6x2, 8x2 applications. Available in E3&E5 and E6 emission levels with 9L and 13L Ecotorq engine generating power 330 and 420 PS Distribution Trucks Tippers, Transmixers, Cement Pumps. 6x4, 8x4, 4x2, 6x2 and 8x2 applications. Available in E3&E5 and E6 emission levels with 9L and 13L Ecotorq engine generating power 330 and 420 PS Construction Trucks Market share details available on page 48.

23 Ecotorq Engine Family 23 Available in 9L 330PS and 13 L 420 to 480PS Environmentally Friendly Euro 6 Emission Levels Turbocharger with Variable-Geometry 2500 bar Common-Rail Fuel Injection System Specially Coated Pistons Smart Charging Alternator

24 The Newest & Widest Portfolio in the Industry 24

25 25 Investment Case

26 Ford Otosan s Value Proposition 26 Scale & growth Industry leader in Turkish and European commercial vehicle sales Turkey s export champion and Europe s largest commercial vehicle manufacturer Technology licensing agreements delivering royalty fees with strong growth potential Resilience & efficiency -denominated export revenues, including non- countries High capacity utilization Efficient, flexible and low-cost manufacturing and engineering competency Strong balance sheet & prudent risk management Surging FCF generation following completion of capex cycle Growth and profitability driven by new products and cost discipline Natural hedge of fx-payables due to fx-denominated export revenues Shareholder value creation Dividend growth with surging FCF, strong balance sheet and low capex Strong relative share performance Commitment to good corporate governance

27 Relatively Favorable Taxes on Commercial Vehicles 27 Passenger Cars Commercial Vehicles Engine Size Base Price (TL) SCT VAT Total Model SCT VAT Total <1.6 lt lt <46,000 46,000-80,000 >80,000 45% 50% 60% 18% 18% 18% 71% 77% 89% Transit Van Transit Minibus (16+1) (17+1) Transit Chassis Cab Transit Custom Van Transit Courier Van <114, % 18% 136% Connect Van Ranger >114, % 18% 148% 4% 18% 23% > 2.0 lt 160% 18% 207% Transit Minibus (11+1) (14+1) 9% 18% 29% New tax structure for PCs is effective as of November 25, Above rates are valid for diesel and gas engines. Different SCT rates apply for electric and hybrid vehicles. Previous tax changes as follows: < 1.6 lt 27% to 30% (Aug 2003), 30% to 37% (Sep 2006) < 1.6 lt 37% to 18% (Apr 09), 18% to 27% (Oct 09), 27% to 37% (Apr 10) < 1.6 lt 37% to 40% (Sept 2012), 40% to 45% (Jan 2014) lt 60% to 80% (Oct 2011), 80% to 90% (Jan 2014) > 2.0 lt 84% to 130% (Oct 2011), 130% to 145% (Jan 2014) Transit Combi Transit Custom Combi Transit Custom Combi Van Tourneo Custom Transit Courier Combi Van Tourneo Courier Transit Connect Combi 15%* * 18% 36% Cargo 4% 18% 23% ** 10% to 15% (Oct 12, 2011) VAT: Value Added Tax SCT: Special Consumption Tax

28 Scalable & -Denominated Export Business 28 Exports (000 units) All export revenues are -denominated, * including non- countries Export receivables are easy to manage as Ford of Europe is the single counterparty Export receivables from Ford Motor Co. and its subsidiaries are collected within average 14 days Export Revenue (US$ bn) Turkey s CV exports * M17 Ford Otosan 72% *2014 numbers reflect the transition to new product range and relevant ramp-up period.

29 Turkey s Export Champion 29 Export breakdown (units) +14% YoY UK 33% Germany 16% +5% YoY 9M17 W. Europe 13% +12% YoY Other 5% E. Europe 9% +6% YoY +19% YoY Belgium 3% France 8% +13% YoY +7% YoY Italy 6% Spain 8% +36% YoY Change in Ford Otosan s unit exports to the relevant market All export revenues are -denominated including non- countries

30 European Van Industry Continues to Grow 30 Industry growth supported by firmer and broader economic recovery Commercial Vehicle registrations- Vans up to 3.5 tons > Ford Otosan s export segment Q17 1H17 9M17 Oct 17 Nov 17 Dec 17 YTD UK 18.7% 15.6% 1.0% -0.9% 3.7% -3.1% -7.4% -11.1% 2.9% -3.6% Germany 7.3% 4.2% 8.5% 8.9% 3.3% 3.5% 19.9% 6.2% 2.2% 4.9% Italy 16.4% 12.4% 50.0% 9.4% 6.5% -0.2% 6.1% -9.4% -18.0% -3.4% Spain 33.2% 36.1% 11.2% 23.6% 16.3% 16.4% 25.0% 18.4% -1.7% 15.5% France 1.5% 2.0% 8.2% 10.2% 6.4% 7.1% 19.0% 8.5% -3.9% 7.1% Total 11.3% 11.6% 11.9% 8.1% 4.7% 4.0% 12.7% 3.3% -3.0% 3.9% December registrations: 172,603 units Jan-Dec registrations: 1,995,797 units -3.0% Dec YoY growth in European van sales 3.9% Jan-Dec YoY growth in European van sales Source: 27 European markets excluding Malta.

31 Ford is Europe s Top-Selling CV Brand 31 Offering an unrivalled selection of vehicles that cater for every requirement Ford s European CV Market Share #7 8.6% #7 8.5% #6 10.0% #3 #1 11.5% 12.6% #1 13.2% #1 13.5% UK Industry: -3.6% Ford: +2.0% Ford is #1 Source: SMMT % December YoY growth in Ford s CV sales 7.2% Jan-Dec YoY growth in Ford s CV sales 80% Ford Otosan s share in Ford Europe s Transit Sales

32 Ford Otosan: Key Driver of Ford s Market Share 32 & Pillar of profitability for Ford of Europe Courier Connect Custom Transit produces 80% of Transit Family vans sold in Europe

33 Large Scale Investment Program >US$1 Billion ( ) 33 Transit Courier US$ 75 million + Ford Trucks Custom 370 million Yeniköy US$ 850 million

34 Favorable Financing Terms million loan agreement signed with EBRD in 2010 (Closed as of December 2015) 5-year term with 2-years grace period at Euribor % 190 million loan agreement signed with EIB in year term with 2-years grace period 100 million in Q3 at 2.06% Effective Interest Rates ST borrowings: 0.84% ST portion of LT borrowings: 1.80% LT borrowings: 1.65% 90 million in Q4 at 1.47% 100 million loan agreement signed with a consortium of foreign banks in July 2014 (HSBC, Societe Generale and The Bank of Tokyo-Mitsubishi UFJ, Ltd.) 4-year term with 2-years grace period at Euribor % 140 million loan agreement signed with EBRD and a consortium of foreign banks in July million funded by EBRD and 70 million funded as syndicated loan (HSBC, Societe Generale, The Bank of Tokyo-Mitsubishi UFJ, Ltd. and Credit Agricole) 5-year term with 2-years grace period at Euribor % 100 million loan agreement signed with EIB in December 2015 and utilized in 1Q year term at 0.87% 150 million loan agreement signed with EBRD in April year term with 3-years grace period at Euribor %

35 Highest Commercial Production Capacity in Turkish Automotive 35 Old: 330,000 (pre-investments) Kocaeli Plant İnönü Plant New: 415,000 (2014) 440,000 (2017) 455,000 (2018) 160, , ,000 15,000 Gölcük Plant Yeniköy Plant İnönü Plant Kocaeli Plants

36 Export Driven Capacity Increase 36 US$ 52 million total investment Capacity ( 000 Units) Current Phase 1 Phase 2 Custom Transit Total Gölcük Plant* 290* 315* 330* Total Ford Otosan Q17 * Total paintshop capacity of the plant. Announced on August 2, September 2018

37 Technology Licensing & Engineering Agreements 37 The agreements with JMC have a 12-year term, starting with 2016 model year, to be extended every 3-years. Ford Otosan will be generating royalty fees with strong long-term growth potential. Ecotorq engines Signed on April 24 th, JMC branded vehicles manufactured in China using these engines and the licensed products will be sold in China and the export markets as agreed by the parties. Chassis, cab and components of Ford heavy trucks Signed on July 25 th, The products and JMC branded vehicles containing these products will be sold in China.

38 Focus on Shareholder Value 38 Strong relative share performance Commitment to corporate governance FROTO 652 BIST Separate CEO and Chairman roles Independent BoD members Audit Committee Corporate Governance Committee Early Determination and Management of Risk Committee Remuneration Committee Foreign ownership in free float, % Earnings per share (for Kr 1 nominal value) YE16 Jan 17 Feb 17 Mar 17 Apr 17 May 17 Jun 17 Jul 17 Aug 17 Sep 17 Oct 17 Nov 17 Dec

39 Commitment to Dividends billion US$ Ford Otosan s dividend payments since Dividends maintained during heavy capex period Dividend (TL mn, gross) Dividend (US $ mn, gross) Policy: In principle, subject to be covered by the resources existing in legal records, and subject to the decision of the Ordinary or Extraordinary General Assembly Meeting, excluding periods of large investment or severe economic downturn, by taking into consideration other legislation, financial and market conditions, long-term strategy, investment and financing policies, profitability and cash position, minimum 50% of the distributable profit for the period calculated within the framework of the Capital Markets Legislation is distributed in the form of cash or stock.

40 Strong & Committed JV Partner Support 40 41% Ford Otosan 41% Free Float 18% Global automotive industry leader based in Dearborn, Michigan, that manufactures and distributes automobiles across six continents. Automotive brands include Ford and Lincoln. 199,000 employees and 67 plants worldwide. Provides financial services through Ford Motor Credit Company. Turkey s largest industrial and services group in terms of revenues, exports, employees, taxes paid and market capitalization on the Borsa İstanbul. Koç Holding ranks among the world s top 500 companies in Fortune 500 (2016 report). Holds leading positions with strong competitive advantages in various sectors, such as energy, automotive, consumer durables and finance.

41 Large Distribution Network 41 Maintenance, service and repairs provided through our customer-focused and innovative network. Dealers are separate legal entities; no ownership by Ford Otosan. Dealer receivables from domestic dealers are collected using a Direct Debit System. Light Vehicles (PC+LCV+MCV) Sales 114 After-Sales 125 Total 159 Ford Trucks Sales 26 After-Sales 30 Total 30

42 Efficient Production Hub 42 Ford Otosan Kocaeli Plants (Gölcük & Yeniköy) Year-end Capacity ('000 units) Kocaeli Plants (Gölcük&Yeniköy) CUR 45% 34% 80% 100% 117% 100% 93% 82% 54% 74% 90% 83% 86% 59% 81% 82% Turkey Industry CUR 29% 35% 52% 73% 76% 81% 86% 77% 57% 72% 76% 68% 73% 70% 80% 86% *2014 numbers reflect the transition to new product range and relevant ramp-up period.

43 R&D Focused on Excellence 43 Ford Otosan has the capability and infrastructure to design, develop and test a complete vehicle end-to-end, including its engine and engine systems. Sancaktepe R&D Center Center of Excellence for heavy trucks and related diesel powertrains Design studio and CAVE lab (1 st in Turkey) Vehicle and engine HIL labs Gölcük R&D Center Engine & vehicle testing Development workshops Patent Applications 137 İnönü Product Development Prototype engine manufacturing and testing The only facility to test extra heavy engines over 13L in Turkey

44 Experienced and Skilled Workforce 44 VocationalHigh School 17% 23% M. Sc. Primary & Secondary School 9% University 2% Blue Collar PhD 1% 6% Others White Collar 70% B.Sc. B.A High School 72%

45 45 Operating & Financial Performance

46 Turkish Automotive Industry (000 units) 46 SCT increase (-) SCT increase (-) SCT increase (-) 1,006 1, Global financial crisis (-) SCT incentives (+) Turkish financial crisis (-) HCV MCV LCV PC Total

47 Turkish Market Shares (2016) 47 Total Industry Passenger Cars 13.4% 12.1% 11.4% 10.6% 14.1% 13.4% 5.5% 7.3% 6.9% 6.5% 6.2% 5.6% 5.5% VW Renault Ford Fiat Opel Renault VW Opel Fiat Hyundai Toyota Dacia Ford Light Commercial Vehicles Medium Commercial Vehicles Heavy Trucks 38.7% 34.5% 41.5% 26.2% 19.6% 28.1% 10.0% 7.4% 7.1% Fiat Ford* VW Renault Peugeot 7.7% 6.4% 5.8% Ford** VW Mercedes Fiat Renault 10.9% 8.8% 3.7% Mercedes Ford Scania MAN Iveco * Courier and Connect ** Transit, Custom & Ranger Source: ODD and TAID

48 Turkish Market Shares (2017) 48 Total Industry Ford s 2 nd largest market share in Europe Passenger Cars 13.3% 12.3% 12.0% 11.9% 15.7% 12.4% 5.3% 8.5% 6.8% 6.2% 5.8% 5.6% 5.5% Renault Fiat VW Ford Hyundai Renault VW Fiat Hyundai Opel Dacia Toyota Ford Light Commercial Vehicles Medium Commercial Vehicles Heavy Trucks 40.6% 36.6% 43.0% 25.3% 8.4% 7.8% 7.0% Fiat Ford Renault VW Peugeot 16.7% 8.4% 7.0% 5.7% Ford VW Mercedes Fiat Renault 27.7% 9.2% 9.1% 4.0% Mercedes Ford MAN Scania Volvo * Courier and Connect ** Transit, Custom & Ranger Source: ODD and TAID

49 Turkish Market & Ford Otosan Retail* Sales (Units) 49 PC Dec '17 Dec '16 YoY YoY Dec '17 Nov '17 MoM Ford Otosan % % % Industry % % % % Share 4,6 4,8-0,3 5,5 5,5 0,05 4,6 5,9-1,3 LCV Ford Otosan % % % Industry % % % % Share 27,4 25,6 1,9 25,3 26,2-1,0 27,4 26,7 0,8 MCV Ford Otosan % % % Industry % % % % Share 41,3 38,2 3,1 36,6 34,5 2,1 41,3 41,4-0,1 Truck Ford Otosan % % % Industry % % % % Share 20,9 23,6-2,7 27,7 28,1-0,4 20,9 33,2-12,3 Total Ford Otosan % % % Industry % % % % Share 12,6 11,3 1,3 11,9 11,4 0,5 12,6 12,9-0,4 Retail sales are Ford branded vehicles sold domestically by Ford dealers. They include dealer inventory and define the market share.

50 Production Volume (000 units) * M17 9M16 Heavy Truck Light Commercial Vehicle Medium Commercial Vehicle *2014 numbers reflect the transition to new product range and relevant ramp-up period.

51 Wholesale Volume (000 units) ** M17 9M16 Domestic* Export Share of Exports 55% 56% 62% 68% 74% 60% 58% 60% 65% 67% 68% 67% 69% 74% 71% * Domestic wholesale volumes are vehicles sold by Ford Otosan to our dealers. They form the basis of IFRS financials. ** 2014 numbers reflect the transition to new product range and relevant ramp-up period.

52 Sales Volume by Model 52 9M17 9M16 YoY% 3Q17 3Q16 YoY % Total Domestic 74,370 77,168-4% 25,711 22,166 16% PC 22,779 24,136-6% 7,594 5,873 29% LCV 23,524 25,724-9% ,801-11% Transit Courier 22,265 23,565-6% 6,488 7,112-9% Transit Connect 1,259 2,159-42% % MCV 24,808 23,836 4% 9,893 7,572 31% Transit 18,236 18,062 1% 7,002 5,717 22% Transit Custom 4,972 4,667 7% 2,193 1,481 48% Ranger 1,600 1,107 45% % Truck 3,259 3,472-6% 1, % Total Export 211, ,735 12% 59,307 53,152 12% Record Transit Custom 112,269 92,804 21% 33,020 27,197 21% Transit 73,614 70,421 5% 19,688 18,629 6% Transit Courier 24,685 24,728 0% 6,254 7,067-12% Cargo % % Other % % Total Wholesale 286, ,903 7,6% 85,018 75,318 12,9% Record

53 Volume Analysis (9M17) 53 Total Sales Domestic Sales Domestic 26% Imports 34% Exports 74% From Production 66% Total Sales Exports by Model Imports 9% From Production 91% Transit 35% Courier 12% Custom 53%

54 9M17 Financial Results 54 TL 17,138 million Revenues, +36% YoY Record 9M revenues Record 9M sales volume; up 7.6% Driven by strong exports TL 12,411 million Export Revenues,+42% YoY Record volumes; up 12% Growth in European van segment Higher demand for our products Currency impact TL 4,728 million Domestic Revenues, +21% YoY Despite 4% volume decline Pricing strategy Positive sales mix TL million EBITDA, +37% YoY Over 24% growth in gross profit Driven by strong OpEx control, cost reduction actions and better YoY OpEx/Sales Lower R&D expenses Higher fx gains TL 986 million Profit Before Tax, +32% YoY Despite the 64% increase in net financial expenses driven by 149% rise in net fx loss TL 980 million Net Income, +54% YoY

55 Main Financial Indicators 55 Million TL 9M17 9M16 YoY % 3Q17 3Q16 YoY % 9M Record Total Revenues 17,138 12,640 36% 5,486 3,840 43% 9M Record Export 12,411 8,720 42% 3,735 2,663 40% Domestic 4,727 3,920 21% 1,750 1,177 49% 9M Record Gross Profit 1,800 1,452 24% % 9M Record Operating Profit 1, % % 9M Record EBITDA 1,482 1,082 37% % 9M Record Profit Before Tax % % 9M Record Net Income % % Other Financial Data Depreciation & Amortization % % Financial Income / (Expense) % %

56 Revenues - Domestic & Export 56 6,208 6,254 5,992 6,160 6,060 5,450 5,454* 4,142 4,516 4,640 4,844 4,948 4,706 4,332 3,702 2, M17 9M16 Export (US$ bn) Domestic (US$ bn) Total (US$ bn) Total (TL bn) Share of Exports 46% 47% 47% 55% 62% 71% 57% 54% 56% 61% 64% 64% 64% 67% 72% 69% *2014 numbers reflect the transition to new product range and relevant ramp-up period.

57 Operating Profit and Margin * M17 9M16 Operating Profit, US$ mn Operating Profit, TL mn Operating Margin (%) 8,8% 8,9% 8,7% 9,5% 8,7% 7,0% 8,0% 7,0% 6,5% 5,9% 4,5% 6,2% 6,1% 6,6% 5,9% *2014 numbers reflect the transition to new product range and relevant ramp-up period.

58 EBITDA and EBITDA Margin 58 Profitability rise post 2015 explained: Strong volumes with new products Favorable domestic sales mix Pricing focus to offset the weak and volatile TL Higher capacity utilization Cost reduction actions margin decline explained: Changing business mix Highly competitive pricing landscape Industry shift towards PC = Less favorable sales mix Aged product portfolio TL volatility causing higher import costs and financial expenses * EBITDA, US$ mn EBITDA, TL mn EBITDA Margin (%) 13,5% 13,2% 11,5% 11,7% 11,1% 10,1% 10,3% 8,4% 7,9% 7,5% 7,1% 8,6% 8,6% *2014 numbers reflect the transition to new product range and relevant ramp-up period.

59 9M17 Margins 59 Operating Margin 6.6% 5.9% 7.7% 5.8% EBITDA Margin 8.6% 8.6% 9.8% 8.8% Challenges: - Rising import costs due to weaker TL/ (average 4.00 in 9M17 versus 3.28 in 9M16) - Higher commodity prices and inflation pressuring domestic margins - Lower domestic volumes 9M17 9M16 3Q17 3Q16 Operating Margin (excl. Other items) 6.8% 6.1% 5.8% 5.1% 9M17 9M16 3Q17 3Q16 EBITDA Margin (excl. Other items) 9.0% 8.2% 8.4% 8.1% Drivers: + Pricing focus to offset the impact of TL devaluation, volatility, commodity prices, and inflation + Positive domestic sales mix: Lower share of imports; growing share of high margin products + High CUR: 84% + Cost reduction actions and strong OpEx control 9M17 9M16 3Q17 3Q16 9M17 9M16 3Q17 3Q16

60 Cost Pressure Weighed on Gross Profit 60 YoY change 1Q17 2Q17 3Q17 9M17 Production Volume Flat 12% 11% 8% Raw Material Costs 34% 44% 44% 40% EUR/TL Rate PPI Inflation, % 3,97 3,92 3,94 3,94 4,09 4,15 4,14 15,36 13,69 16,09 16,37 15,26 14,87 15,45 16,34 16,28 3,68 3,91 3,91 9,94 3,32 3,38 3,54 1,78 2,84 6,41 Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Source: CBT Source: CBT

61 PBT & Net Income Deferred Tax Asset * Net Income (Million $) Net Income (Million TL) Net Income Margin (%) 7,8% 6,6% 7,7% 6,7% 6,2% 6,0% 6,6% 6,3% 7,0% 5,6% 5,0% 5,0% 5,2% Earnings Per Share (TL) 1,24 1,14 1,43 1,38 1,24 0,95 1,44 1,89 1,95 1,83 1,70 2,40 2,72 Profit Before Tax (Million TL) Profit Before Tax (Million $) *2014 numbers reflect the transition to new product range and relevant ramp-up period.

62 Return on Equity 62 45,0% 40,0% 35,0% 30,0% 25,0% 20,0% 15,0% 27.3% 24.8% 30.7% 28.2% 25.5% 20.2% 28.8% 34.9% 34.3% 24.2% 21.6% 27.5% 30.2% 36.6% 38.1% 35.9% 10,0% 5,0% 0,0% Q17 1H17 9M17 *2014 numbers reflect the transition to new product range and relevant ramp-up period.

63 Financial Risk Management 63 Credit Risk Receivables from domestic dealers are collected using a Direct Debit System Receivables from Ford Motor Company and its subsidiaries are collected within 14 days Other exports are guaranteed using L/C, letter of guarantee or cash collection Liquidity Risk Cash, credit commitment and factoring capacity is maintained to meet 21 days cash outflow 80 million credit commitment & 125 million factoring agreements for potential needs Net debt as of 9M17 is TL2 billion FX Risk Excess cash is invested in hard currencies to minimize fx exposure Natural hedge against volatility due to fx-denominated export revenues: 72% of revenues Ford Otosan is a net exporter: US$ 4.0 billion in the last 5 years ( ) Capital Risk Net financial debt / tangible equity is monitored as a management criteria; capped at 1.25

64 Debt Profile & Financial Ratios 64 Cash Position (TL mn) Cash & Cash Equivalents 1,495 1,189 Total Financial Debt (3,527) (2,852) Net Financial Debt (2,032) (1,663) Financial Ratios Current ratio Liquidity ratio Net Financial Debt / Tangible Net Worth Current Assets / Total Assets Current Liabilities / Total Liabilities Total Liabilities / Total Liabilities and Equity Return on Equity 35.9% 30.2% Margins Gross Margin 10.5% 11.5% EBITDA Margin 8.6% 8.6% EBITDA Margin (excl.other items) 8.2% 8.4% Operating Margin 6.6% 5.9% Net Margin 5.7% 5.0%

65 2017 Guidance 65 Turkish Industry Volume 2016 Actuals 1,004 Tı K K 1,000K Ford Otosan Retail Sales Volume 115 K K Exports 257 K K Wholesale Volume 373 K K Production Volume 334 K K Capex (fixed assets) 152 mn mn Guidance updated in October 2017.

66 Contacts 66 Investor Relations App Aslı Selçuk Investor Relations Manager Alçin Hakca Investor Relations Officer Burak Çekmece Treasury & Risk Manager (Capital Markets Law Compliance) Disclaimer: This presentation contains forward-looking statements that reflect the Company management s current views with respect to certain future events. Although it is believed that the expectations reflected in these statements are reasonable, they may be affected by a variety of variables and changes in underlying assumptions that could cause actual results to differ materially. Neither Ford Otosan nor any of its directors, managers or employees nor any other person shall have any liability whatsoever for any loss arising from use of this presentation.